Djibouti and the EU

11/05/2016 - 16:21

EU relations with Country

With an estimated population of 820,000, the Republic of Djibouti is one of the smallest states in Africa. It currently enjoys a high growth rate but faces challenges with regard to sustainable and shared development. The European Union is the primary international donor there, acting exclusively through grant aid, with water, sanitation, resilience and food security being its chief priorities. Promoting peace and security in the region is also central to European involvement, as Djibouti is the EU's logistics base for its anti-piracy operation, Operation Atalanta.

The European Union and the Republic of Djibouti are working together to stabilise the Horn of Africa, particularly through AMISOM and Operation Atalanta and, until recently, Eucap Nestor. The EU and Djibouti both support IGAD, encouraging it to become more effective in such areas as peace, security and regional integration.

As part of the political dialogue provided for under Article 8 of the Cotonou Agreement and also through various approaches and contacts, the EU and its Member States promote democracy, the rule of law and respect for civil liberties in Djibouti.

Main factors in EU-Djibouti relations

With regard to the 11th European Development Fund (EDF), the National Indicative Programme (NIP) is in line with the long-term objectives outlined in ‘Djibouti Vision 2035’ and the national programme for food security. Given the considerable strain on natural resources facing Djibouti, the EU has chosen to invest its allocated funds (€105 million) in water, sanitation and food security in order to address the country’s structural challenges and create an exit strategy for humanitarian aid. This also means that development benefits the most disadvantaged populations.

The preceding programme, the 10th European Development Fund (EDF), focused on ‘Water, sanitation and energy’. The EU has been very active in these areas ever since the beginning of its relations with Djibouti. Access to drinking water has, in fact, always been a priority, as has wastewater treatment, which is considered one of the main environmental issues facing the country and its capital.

The EU is also very committed to promoting stability and peace in Djibouti and the region, in particular with regard to maritime security. There are several large-scale initiatives to support the country’s efforts to fight piracy. The most well-known is Operation Atalanta, which joins the forces of several EU countries under the European flag.

Djibouti is also taking part in negotiations between the EU and East and Southern Africa to create an economic partnership. Djibouti is not a signatory to the European Union’s economic partnership agreements (EPA), but discussions are scheduled to take place with eligible countries to encourage them to sign the agreements.

The Djibouti government has announced that it wishes to reform its public sector institutions to make them more efficient in terms of economic and financial management. In particular, this means modernising the rules of governance for companies and public sector institutions by encouraging management autonomy with a view to enhancing their executive bodies' transparency, efficiency and responsibility.

With regard to the PEPER project, ‘Producing Safe Drinking Water with Renewable Energy’, the financing agreement covers sector-specific reforms in the areas of water and electricity. These reforms target the technical and financial viability of companies and public sector institutions (Djibouti National Water and Sanitation Initiative – ONEAD and Djibouti Electricity Authority – EDD)

Djibouti is a member of the World Trade Organisation (WTO) and grants at least MFN treatment – the most-favoured-nation clause: equal treatment to others – to all its trading partners. The country has made commitments with respect to trading goods and services. Djibouti is not a signatory to any WTO multilateral agreements.

At the Ministerial Conference in Bali in December 2013, WTO members, including Djibouti, concluded negotiations resulting in the Trade Facilitation Agreement (TFA). This agreement will come into force as soon as two thirds of WTO members have ratified it. The TFA aims to speed up cross-border movement of goods, including goods in transit. It also contains provisions for a more effective cooperation between customs and other competent authorities.

Other agreements and organisations

Djibouti is a member of IGAD, COMESA and the African Union and a contributor to African initiatives involving integration at a continental level. Although Djibouti ratified the agreement on the Trade Preferential System (TPS) among member states of the Organisation of Islamic Cooperation (OIC), it did not commit to dismantling its tariff and non-tariff barriers. Djibouti is in the process of negotiating a free trade zone under the Arab League.